More federal tax on gasoline

By Jim Killebrew

[February 05, 2015]  For a variety of reasons ranging from increased production of oil world-wide, including in the United States on private property, the cost of oil has been reduced resulting in the reduction of the price of gasoline. It was reported on January 5, 2015 that the price of oil fell below the $50. mark for the first time in five years. Combined with that, Russia and Iraq have increased their production at the lower prices as well. For sure, it has caused the price of gasoline to continue to plunge in price. For the driving American this has resulted in a form of stimulus plan that is allowing the average citizen to have more money in his wallet that he is not paying in higher gas prices. It leaves more cash to spend in other areas of life.

Consequently, with all the activity of the oil cost reduction it has caused a raise for every driver in America. Households have been experiencing a fuel bill that rivaled their house payments or grocery bill. So with the reduction of gas prices there has been a breather that has allowed families to keep more of their wages to spend on other things. Fear not, however, if the American people see the reduction in oil prices with lower prices for gasoline, the politicians in Washington, D.C. see it as a reason to raise the taxes on the gasoline Americans use.

The politicians are proposing a raise in the federal fuel tax from the current 18.4 cents per gallon for gasoline up to 33.4 cents per gallon. This will be the first time the tax has been raised on gasoline on the federal level since 1994. Although the tax has been called for by democrats Dick Durban (D-IL) and Nancy Pelosi (D-CA), and Earl Blumenauer (D-OR) who proposed HR-680 that calls for the increase in the tax on gasoline. Of course, what politician has ever seen a tax that he or she does not fall in love with. The republicans are hinting they will be on board for the increase as well. James Inhofe (R-OK), Orrin Hatch (R-UT), and John Thune (R-SD) have all said they think in the discussions the tax increase is certainly an option. Nancy Pelosi, at a recent press conference stated, "If there's ever going to be an opportunity to raise the gas tax, the time when gas prices are so low-oil prices are so low-is the time to do it." There are a couple dozen Congressional members along with the Illinois Representative, Jan Schakowsky (D-Evanston) co-sponsoring this bill. The further and more aggressively they push to push this law through, the more likely it will become a reality, given the President would sign it into law and be happy about having another tax.

Even though the politicians have stated they want to raise the taxes on gasoline to place it in a trust fund established as the Highway Trust Fund. Supposedly the money would be used to rebuild highways, bridges and other transportation needs. However, the past behaviors from the politicians have proven they have not always restricted the Highway Trust Fund (HTF) money for those things. According to The Heritage Foundation's Factsheet #148, published on 7/21/2014 money from the HTF has been diverted.

-- The Highway Trust Fund (HTF) was created in 1956 to finance the construction of the interstate highway system, which was largely completed by the early 1980s.

-- The current 18.4 cents per gallon gasoline tax, 24.4 cents per gallon diesel tax, and related fees pay for a portion of current highway and transit spending. Moving Ahead for Progress in the 21 Century (MAP-21), the current law governing federal highway and transit programs, authorizes about $14 billion more in annual spending than the HTF collects in revenue.

-- Since 2008, Congress has diverted $54 billion from the General Fund of the Treasury to the HTF." (Heritage Foundation, Factsheet #148, 7/21/2014)

We must remember, just because the prices of gasoline is currently selling at a lower price, giving the average citizen a boost in their budget, there is no guarantee those prices will continue. In fact, other policies the Administration has put into place through the Environmental Protection Agency (EPA), along with the attempts to decimate the coal industry in the United States, along with putting enormous amounts of money into research for alternative energy sources, it almost ensures the cost of oil will one day be as high or higher than it has during the past six years.

Do the American people want another federal tax on their gasoline?

[By JIM KILLEBREW]